Hatch Financial Services

Navigating the Landscape of Refinancing & Restructuring Your Home Loan

Most home loans are set up over a 30-year term. Yet, the average loan length is somewhere between 3-7 years.

Sometimes loans are paid out early as borrowers sell the property and move in a different direction.

Mostly the changes are due to borrowers refinancing or restructuring their loan.

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The reasons for refinancing or restructuring loans are numerous

The primary drivers are:

Seeking a lower interest rate on existing lending (to save money and/or pay off the loan sooner)
Seeking lower repayments on existing lending (to ease cashflow)
Consolidating credit card debt or personal/car loans into a home loan (to ease cashflow and save money)
Borrowing additional funds for renovations/improvements, or to purchase other non-property assets (like cars, furniture, boats, shares)
Borrowing additional funds to be used towards the purchase of a 2nd, 3rd, or 4th property

The team at Hatch Financial Services will discuss your options and help you evaluate both the merits of refinancing/restructuring your lending as well as the lender/loan options available to you.

Get in touch to discuss your options.

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Loan Options for Your Needs

While people typically are focused on rates, equally important are things like the loan term, repayment type and loan features.

Our team will take you through these considerations and help you find the right loan for you.

Hatch Financial Services works with a panel of over 25 lenders to provide a wide range of options tailored to your needs.

Our mortgage brokers will help you compare interest rates, loan features and repayment structures to find the perfect loan for your situation.

Get in touch with Hatch Financial Services today.

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Offset Accounts Explained

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Start Your Journey with Us

Hatch Financial Services is here to ensure your journey is as clear and straightforward as possible.

Contact us to explore your loan options and begin the journey towards realizing your dream home.

Interest Only Loans

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FAQs

Why should I consider refinancing? And When?

You should review your finances/home loan every year. Ask yourself is the loan at a competitive rate? Is the loan as it stands meeting your needs?

What do we mean when we say “Is the loan meeting your needs”?

Things you ought to consider under this question include:

Are you utilising the features of the loan such as offset? If not, would changing product or lender save you money?
Conversely are there features that might suit that you don’t currently have value suchas a fixed rate loan or an interest only loan?
Do you need to borrow money for something this year (payoff a credit card, buy a car, do some home improvements,cover some one off expenses like dental work for the kids)?
Do you have a lot of money in redraw or offset but are finding the loan repayments a bit of a stretch?

What are the costs associated with refinancing?

The costs to refinance include:

A discharge fee from your existing lender
Government fees to register the discharge of mortgage and the register the new mortgage
Break fees if there is a fixed rate loan being paid out early
Application, Valuation and Settlement fees for the new loan

In the majority of cases the costs to refinance are between $500-$1000 in total. This cost can often be built into the new loan amount.

Will lenders pay for me to move across to them? Or offer other incentives?

In recent years we have seen a variety of lenders offer rebates to refinance. The amount of the rebate might depend on the loan size or the Loan to Value Ratio. These offers come and go and the size of the rebate varies too.

Before accepting a refinance rebate be careful to consider the value of the rebate compared to cheaper rates that may be available with other lenders. Also be clear as to the rules to qualify for the rebate.

What documents will I need for refinancing?

To simply re-price your loan with your existing lender requires no documents and only a few details from you.

Restructuring or refinancing your lending requires a full loan application and assessment, so the documents required are the same as for a new home loan (payslips, loan statements, ID’s etc)

How long does it take to complete the refinance process?

If we are restructuring your loan with the current lender than the process will take between 1-4 weeks. The exact timeframe will depend on how busy the lender is and precisely what is involved.

If we are moving lenders, then it is best to allow 6 weeks but with some lenders or situations it can be done in around 4-5 weeks.

Is refinancing the best option?

Although refinancing to lower your repayments might seem attractive, you need to carefully consider the value of lower repayments if it is achieved by extending the loan term as this will usually mean that you pay more interest over the life of the loan.

Other factors to consider:

What are the fees/costs to restructure? Do these outweigh the benefits?
What are your longer-term plans? Will a re-structured loan remain affordable based on your expected financial situation in the future?
How flexible is the loan? Can you pay it off sooner if you finances allow it? Might the rate on the loan increase?
Do you have sufficient equity in your home to make refinancing a viable option?

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